updated 12:46 pm EDT, Thu July 19, 2012

Nokia continues to struggle, but doubles Lumia sales

Nokia has posted the latest in a series of mounting losses with its Q2 results (pdf) returning a $1 billion operating loss on the back of the $775 million loss it reported in Q1. On a positive note, its Windows Phone 7 Lumia range reached 4 million sales for the quarter, an improvement quarter-on-quarter of 2 million sales. In another unexpected positive, it managed to increase its net cash by approximately $125 million, boosting its net cash holdings to around $5 billion.

Although the company sold a total of 73 million handsets for the quarter, another quarter-on-quarter improvement thanks to the introduction of its Asha line of feature phones, it faces another tough quarter ahead as it tries to maintain consumer interest in its Windows Phone 7 handsets ahead of the launch of Windows Phone 8 devices around October. With the revelation that current Windows Phone 7 handsets are not upgradeable to Windows Phone 8, this could prove to be a considerable hurdle to overcome.

"We shipped four million Lumia Smartphones in Q2, and we plan to provide updates to current Lumia products over time, well beyond the launch of Windows Phone 8," said Nokia CEO Stephen Elop. "We believe the Windows Phone 8 launch will be an important catalyst for Lumia. During the quarter, we demonstrated stability in our feature phone business, and enhanced our competitiveness with the introduction of our first full touch Asha devices," Elop added.

Looking ahead, Nokia CEO Stephen Elop says that the company is urgently executing its restructuring plans during the ongoing transition away from its obsolete Symbian OS and related devices. As a result, Nokia says that it expects Q3 to "be a challenging quarter in Smart Devices due to product transitions."